In this post, we look at the companion book, Positioning: The Battle for Your Mind. The following excerpt is from Chapter 13: When Line Extension Can Work.
For reference, the author’s definition of line extension is closer to brand extension: the use of an existing brand name in a new product category. Excuse the outdated examples.
The classic test for line extension is the shopping list.
Just list the brands you want to buy on a piece of paper and send your spouse to the supermarket: Kleenex, Bayer, and Dial.
That’s easy enough. Most husbands or wives would come back with Kleenex tissue, Bayer aspirin, and Dial soap. Line extensions like Kleenex towels, Bayer-non aspirin, and Dial antiperspirants have not destroyed the brands’ original positions. Yet. But give them enough time to hang themselves.
How about this list: Heinz, Scott, Kraft.
Will your spouse bring back Heinz pickles or ketchup (or perhaps baby food)? Scott tissue or towels? Kraft cheese, mayonnaise, or salad dressing?
As a native Pittsburgher, Heinz will only ever mean ketchup to me. But you get the point.
You pass the shopping list test when the brand name is equivalent to the category.
Google means “search.” Kleenex means “facial tissues.” In those cases, using the brand name is more common than using the category name.
To Extend or Not to Extend
Even big, smart companies use their brand name on new categories because line extension is easy and provides the best short-term results. The cautious executive won’t get fired for using the proven, successful brand name.
Creating a new brand is risky and requires more money and more work.
Early sales due to the brand name are easy to measure. Long-term brand erosion and cannibalization is not. With most businesses focused on short-term results, line extension is the obvious choice.
Not all line extensions fail. Some are successful. Why was Diet Coke a best-seller but New Coke a punchline? And how do we decide when to use the “house” brand and when to build a new one?
Positioning has a few rules of thumb. Below are the most applicable to small companies.
- Significance. Breakthrough products should not bear the house name. Commodity products should.
- Expected volume. Potential winners should not bear the house name. Small-volume products should.
- Competition. In a vacuum, the brand should not bear the house name. In a crowded field, it should.
- Distribution. Off-the-shelf items should not bear the house name. Items sold by sales reps should.
At Tortuga, we’ve focused on “travel backpacks.” Each backpack gets a “Tortuga” name: Tortuga, Tortuga Air, Tortuga Daypack.
Each bag is within our category of “travel backpacks,” is targeted to the same audience, and offers similar benefits. They all stay under the Tortuga umbrella.
Commodity products, like our packing cubes, get the house name even though they are not backpacks. We expect these accessories to be complimentary add-ons, not best-sellers.
We follow Apple’s model. Apple creates “brands” around each of its products. The Apple name then comes to represent personal computing regardless of form factor.
The iPhone is its own brand. You’ve probably heard people use “iPhone” to mean “smartphone.”
Making a Brand Into a Category
How do you make your brand stand for your category? Is there a strategy to this or is it a consequence of overwhelming market share?
How do we make “Tortuga” mean “travel backpack?” No other brand owns this category. No brand owns any category within luggage. Samsonite was (and is) a popular brand. But did anyone ever say “Samsonite” when they meant “suitcase?”
Our strategies are:
- Repeat, Repeat, Repeat: Use the phrase “travel backpack” when describing a product. Use “Tortuga Travel Backpack” on product pages and elsewhere to tie the two terms together in travelers’ minds.
- Avoid Line Extension: To date we’ve focused on travel backpacks and related accessories. If we ever went into another category, we would use a separate brand name.
- Keep Product Names Consistent: We considered but decided against using unique (non-Tortuga) names for each backpack. Since they all provide the same benefits and fall into our targeted category “travel backpack,” they all get the Tortuga name.